A profit maximizer is a product or service that is sold alongside your flagship or staple product with the intent to improve margins. We discussed the basics of profit maximizers in our post Are You Making the Most of Every Customer Conversion?
When you’re thinking about how to incorporate profit maximizers into your sales funnel, it helps to think of the customer’s needs holistically. No matter what industry you’re in, and whether you sell products or services, chances are that your customers need more than one thing to solve the problem they have.
Think of yourself as a solutions provider, rather than just providing services or products, if you want to indefinitely provide value to your customers.
To determine what products or services to use as your profit maximizers, first calculate your margin on every product and service you sell. Once you have these numbers, start by bundling the products and services into categories that make sense.
Here are some ideas to get you started:
If a customer is about to click the “buy” button on something, is there another product that enhances the purchase and makes it even more useful? If so, find a way to suggest it, and make sure it’s very easy for the customer to throw it into their shopping cart. This is your “Would you like fries with that?” offer.
You’ve probably seen this on many e-commerce websites. It can happen on the product page (at which point you’re moving into “Instant Upsell” territory) or after the purchase, via email. This is your “If you liked this, you’ll probably also like…” offer.
These are items that cost 10-100x times the item you’re selling. These are items no one really expects anyone to buy, like the $50,000 vintage Les Paul at Guitar Center. Almost no one will buy them, but when 1% of customers do, your margins will skyrocket. Another benefit is that these products’ high price helps other prices look much more affordable.
Bundles can be very helpful to a customer who wants to one-stop-shop for a solution. They also give you the chance to stand apart from other companies who may be selling a similar core product — are theirs as well thought out when it comes to what is bundled together?
Obviously, if you can get your customer to commit to buying something over and over again instead of just once, this can have a great impact on your bottom line. Think about if there is an opportunity to turn an existing offer or splinter a new offer into a subscription model.
If you’re great at one product, and are becoming known for it, think about how you can diversify your product offerings, particularly if these related products have higher margins.
Faster and better
Some customers don’t care as much about savings as they do about achieving things quickly and in a straightforward manner. If you offer a service, consider adding an extra level that offers more customer support and/or faster turnaround time. If you’re selling a product, expedited shipping might be a way to help customers out, and improve your margins while doing it.
We hope we’ve given you some ideas on how to increase your margins while also helping your customers get exactly what they need. Have questions about how to more fully incorporate profit maximizers into your ecommerce strategy? Reach out to us today!